An artificial intelligence infrastructure consortium led by Microsoft Corp., Nvidia Corp. and BlackRock Inc. today announced it’s planning to buy Aligned Data Centers LLC in a deal valued at about $40 billion.

It’s one of the largest-ever acquisitions of data centers, designed to secure vast and highly coveted AI computing capacity for the consortium’s members.

The consortium, known as the AI Infrastructure Partnership or AIP, was formed last year by BlackRock’s Global Infrastructure Partners unit, Abu Dhabi’s state-backed investment group MGX and Microsoft. Nvidia and Elon Musk’s xAI Corp. joined the consortium in March, along with Singapore-based Temasek Holdings Ltd. and the Kuwait Investment Authority.

Founded in 2013, Aligned Data Centers has emerged as one of the major winners of the AI infrastructure spending boom. It operates a number of colocation data centers that rent capacity to customers, and it also builds data center facilities for hyperscale and enterprise firms. It currently operates data centers in Chicago, Dallas, Phoenix, Salt Lake City and Northern Virginia, and it’s building additional sites in Illinois, Maryland, Ohio and Virginia.

In addition, it has a massive operation in Latin America, having acquired a company called OData in May 2023, which has facilities in Brazil, Chile, Colombia and Mexico. It’s also an investor in the Canadian data center operator QScale SEC, which gives it a foothold in that country, too. All told, it operates 50 data centers globally, amounting to 5 gigawatts of compute capacity.

In January, Aligned was boosted by a $12 billion capital injection that came from two sources – $5 billion in primary equity from its current parent company Macquarie Asset Management LLC and $7 billion in new debt commitments. Aligned’s customers include the data center software company Nutanix Inc. and the information technology services provider Datto Inc.

The AIP consortium said the acquisition will help it to accelerate its mission of “advancing the infrastructure and innovation needed to power the future of AI.”

“With AIP, MGX and GIP’s global reach, extensive resources, and deep expertise across AI, energy and finance, we are poised to scale faster, innovate further and redefine what’s possible in sustainable data center infrastructure,” said Aligned Data Centers Chief Executive Andrew Schaap.

The acquisition is just the latest example of how big technology companies are funneling billions of dollars into the infrastructure required to power their AI innovations. The likes of Google LLC parent Alphabet Inc., Meta Platforms Inc., CoreWeave Inc., Oracle Corp. and Microsoft have committed to spending more than $400 billion on AI data centers this year.

Meanwhile, OpenAI has partnered with Oracle and SoftBank Group Corp. on the $500 billion Stargate initiative that aims to build a cluster of data centers in the U.S. In addition, the ChatGPT maker has also struck deals with Nvidia, Advanced Micro Devices Inc. and Broadcom Inc. that may eventually be worth over $1 trillion to secure the AI accelerators needed to fill those data centers, which will have a combined capacity of around 26 gigawatts.

Meta also has plans to build a number of new data centers in the U.S., including a newly announced $1.5 billion facility in Texas and a massive complex in Louisiana called “Hyperion” that’s expected to provide 5 gigawatts of capacity when it comes fully online in 2030.

The enormous spending on data centers is the AI industry’s equivalent of the “gold rush”, with companies hunting for computing resources rather than precious metals, said Holger Mueller of Constellation Research Inc. “It’ll take time to see if these efforts pay off, but the deal makes sense because data centers take a long time and a lot of money to build,” he said. “It’s a solid acquisition because Aligned has been building and operating data centers for years, and so this expertise will come in handy too. AIP is hitting the ground running.”

Photo: Aligned Data Centers